Analysis

Kim GhattasBBC News, Rangoon

Hillary Clinton and Aung San Suu Kyi emerged from their morning of talks sounding hopeful about the prospect of change in Burma.

The Nobel laureate said that engagement was the way forward - that if everybody worked together there would be no turning back from the road to democracy. But she warned that Burma was not on that road yet.

Aung San Suu Kyi also thanked the US for what she described as its calibrated approach to engagement with the Burmese leadership.

Standing outside Ms Suu Kyi's home where she was held under house arrest for years, the two women embraced warmly.

Mrs Clinton called the pro-democracy activist an inspiration to people in her country and around the world.

Mrs Clinton told the BBC she had followed Aung San Suu Kyi over the years and it had been an honour to meet the pro-democracy leader.

"It was like seeing a friend you hadn't seen for a very long time even though it was our first meeting," she said.

"It was incredibly emotional and gratifying to see her free from the many years of house arrest."

She said Ms Suu Kyi was wise to take advantage of the signs of change in Burma but that continuing actions were needed from the Burmese authorities.

"There has to be a momentum behind reform and we're waiting and watching for that," said Mrs Clinton.

The Burmese government continues to hold hundreds of political prisoners and the country is still plagued by ethnic conflicts.

The US maintains tight sanctions on senior leaders in Burma, which was ruled by a brutal military junta from 1962 until 2010.

The army handed power to a civilian government last year, but the military's primacy is entrenched in the country's constitution.

However, the government has implemented a series of reforms.

It freed Ms Suu Kyi from detention and allowed to her take up a role in public life.

Hillary Clinton says meeting Aung San Suu Kyi was a "a great honour and delight"

The reforms led to speculation that decades of isolation could be about to end.

Mrs Clinton and Ms Suu Kyi had a private dinner in Rangoon on Thursday.

They met again on Friday at Ms Suu Kyi's Rangoon home, where the Nobel Peace Prize winner was held under house arrest for many years.

'New chapter'

Ms Suu Kyi's National League for Democracy recently re-registered as a political party, and she is expected to stand for parliament in forthcoming by-elections.

The NLD won a landslide election victory in 1990, but the junta refused to recognise the result and the party was never allowed to take power.

Ms Suu Kyi spent much of the next 20 years in detention.

On Thursday, Mrs Clinton met President Thein Sein, a former general and top leader of the previous regime.